building houses for those people and successfully financing them. CUE: What can be done to keep capital in the local area? MATTHEI: What's needed is both public and private activity. We've spent most of the day talking about what investors can do in the private sector. The social investment movement is also in some sense a grassroots political movement. This movement can help build a constituency that can build more effective public policy. We ought to be looking at how public agencies dispose of publicly held property. We should insist that every public agency give first consideration to economic institutions that have the greatest benefit for the community over the long term. We should be willing to take even more aggressive action if that's what required. In New Bedford, Massachusetts, the mayor threatened to use eminent domain power to seize a factory to protect it from becoming a runaway shop to Taiwan, leaving the community in shambles. We need to recognize where the community has created value and assert our legitimate interests as a public body. What would a just economy look like and how will we get there? Finally, I think we need to hold the private institutions more accountable. In Massachusetts we have an organization called the Massachusetts Urban Reinvestment Advisory Group. It monitors bank compliance with the Community Reinvestment Act [CRA]. CRA doesn't go far enough, but it at least says that banks have some responsibility to the communities in which they are taking all that money. A CRA challenge in Chicago resulted in a $135 million settlement from the major banks and a commitment to mortgage money to neighborhood housing development. It's a movement on several levels. It's a movement on the grassroots level wherever it's conducted. It's a movement of accountability to private institutions. It's a movement to change the focus and priorities of public policy. DOMINI: If you want a prediction, community investment is going to be the area you are going to hear most about in the next few years. This is what people are looking at at the national level. The Episcopal Church nationally divested from South Africa. The next area of study is community development, not divesting weapons. CUE: Are institutions willing to accept a lower return that may result from community investments? DOMINI: Institutions are created for some social purpose. South Africa made them aware that they have money and that it was working in conflict with their social values. Now they are interested in a positive step. They are studying community investing as one positive step. CUE: What directions are emerging in the SRI movement? BAVARIA: We are beginning to see a mainstream interest in what we are doing. I don't think anything gets done in this country unless it reaches the mainstream. We are a middle class society. Any invention is started by "mad artists" and then others pick up the idea. I think that's what's happening now. Union and public pension funds are beginning to get interested. It's hitting people it never hit before. It's not just on the fringes. CUE: What efforts are being made to expand interest in SRI? BAVARIA: The Social Investment Forum has engaged in a public relations effort where we are appearing on television programs. The media have been very kind to us and written good things about us. Some less than good things, too, but that's just part of public debate. There are various kinds of educational seminars. Amy wrote a book; there are some of us who are publishing. There is a lot of outreach, networking, and public relations involved. Last, but not least, we are striving to achieve excellent performance and be wonderful professionals. Money is power. The investment of money can become the exercise of power. MATTHEI: I think this movement is moving out of its infancy, but is still a very small child. We've achieved the goal of putting the concept before the public—at least there is initial recognition in quite a number of quarters. Clearly the next step is a lot of promotional activity—spread the word and debunk the myths. Over time, there are going to be some legislative issues, particularly regarding pension fund investments. Pension funds, in the foreseeable future, will account for about half the value of the American economy. There is the potential to redirect the economy in fundamental ways. It's important for us to grow as a movement, not simply to look outward but to look Page 6
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